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INTRODUCTION TO SELLING AND SALES MANAGEMENT
If you sincerely believe that “the customer is king,” the second most important person in this kingdom must be the one who has a direct interaction on a daily basis with the king. MICHAEL BON CHAIRMAN & CEO, FRANCE TELECOM Chapter Consultant: Paulette Turner, Sales Operations Business Unit Executive, IBM Corporation

LEARNING OBJECTIVES
After studying this chapter, you should be able to: Describe the major changes taking place in selling and the forces causing these changes. Define sales management. Describe the sales management process. Discuss the competencies required to be a successful manager.

SELLING AT DELL COMPUTER
Marty Sedlacek is an account executive at Dell Computer. Dell’s roots are in the mail-order business, which did not include outside salespeople like Marty. It relied instead on PR, advertising, and direct mail; targeted individuals and small companies; and was all about getting the phone to ring. Today, however, 90 percent of Dell’s sales are to corporate and government customers, most of whom have a complex continuing relationship with Dell that probably began with a visit from someone like Marty. Marty is married, has a 9-month-old son, and lives in new four-bedroom house in Round Rock, Texas. Although he lives within 7 minutes of the office, Marty spends more time in airplanes than he does in his car. In a normal week, he leaves Austin on the 7:07 A.M. flight to O’Hare, rents a car at the airport, dives into a 4-day schedule of sales calls, and flies home Friday night. “I don’t want to be doing this job forever,” Marty says, but he is not 1

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complaining. In fact, just the opposite. He’s 32 years old. He has topped his quota 22 months straight. Last winter he and his wife unwound for a week in the Canadian Rockies, all expenses paid. This spring he’s shooting for the trip to Costa Rica, and he likes his chances. Marty’s base salary is $64,500. If he makes 100 percent of his quota, he doubles that. Beyond 100 percent, the incentives quadruple. He participates in his company’s 401(k) plan in which the company matches 100 percent of his contributions in Dell stock. In addition, he spends 15 percent of his after-tax pay on discounted shares available through the employee stock-purchase plan. A recent call on Ace Hardware’s headquarters is typical for Marty. Ace is a new account for Dell. Marty broke the ice with Ace in February with an order for $250,000 of Dell desktops. Marty is calling on Ace to gather competitive intelligence on who Dell is competing with for Ace’s notebook and server business. He is also equipped with a testimonial from a client who praises Dell notebooks and a consultant’s report that does the same for Dell servers. Mostly, however, Marty asks questions during the call. He takes careful notes in his planner with a multipoint pen: red ink for action items, black ink for intelligence tidbits. By the end of the meeting, Marty knows which companies Dell is competing against (Toshiba, IBM, and NEC on notebooks; HP on servers), who at Ace will decide the order, what matters most to them, and when they’ll make up their minds. One subject that never comes up is price. Marty doesn’t talk terms. He doesn’t take orders. He’s what’s known in Dell’s internal lexicon as a hunter, one of 20 in the preferredaccounts division. A hunter’s job is to establish a new account, get the order flow started, and then give way to an inside salesperson.1 These are very exciting times to be in sales and sales management. Many organizations are finding that sales force changes are needed for more demanding customers in an increasingly competitive world. Giant retailers such as Wal-Mart and Target are leveraging electronic data technology and are requiring manufacturers sales forces to assume responsibility for “just-in-time” inventory control, ordering, billing, sales, and promotion. Like other companies, Hewlett-Packard now rents an office in a key customer’s headquarters building and stations an account manager there. These innovations in the way suppliers and customers interact have necessitated changes in the way sales forces are organized, compensated, developed, and evaluated. Our goal in this textbook is to explain how the sales team operates in this new environment and how they may be supervised for maximum efficiency and effectiveness. We begin by defining personal selling and describing its role within a firm’s promotion mix. We then turn to some of the changes taking place that have had an important impact on the sales function. Next, we direct our attention to the sales management function by describing the activities they perform, a process of sales management, and the competencies needed to successfully perform these activities and the sales management process. The final section of the chapter profiles career paths that you may find in your first sales job.

PERSONAL SELLING
According to the U.S. Department of Labor’s Bureau of Labor Statistics, people working in sales number close to 12 million, or about 10 percent of the total workforce in the United States. Personal selling is critical to the sale of many goods and services, especially major commercial and industrial products and consumer durables, and can be defined as:
Direct communications between paid representatives and prospects that lead to transactions, customer satisfaction, account development, and profitable relationships.

The relationships between selling and other elements of the marketing mix are highlighted in Figure 1-1.

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PERSONAL SELLING

3

Marketing mix

Products

Prices

Promotion

Distribution

Advertising

Public relations

Personal selling

Sales promotion

Internet

Sales management Planning Budgeting Recruiting and selecting Training Motivating Compensating Designing territories Evaluating performance

FIGURE 1-1

Positions of Personal Selling and Sales Management in the Marketing Mix

Marketing programs are designed around four elements of the marketing mix: products to be sold, pricing, promotion, and distribution channels. The promotion component includes advertising, public relations, personal selling, and sales promotion (point-of-purchase displays, coupons, and sweepstakes). Note that advertising and sales promotions are nonpersonal communications, whereas salespeople talk directly to customers. Thus, where advertising and sales promotion “pull” merchandise through the channel, personal selling provides the “push” needed to get orders signed. With public relations, the message is perceived as coming from the media rather than directly from the organization. Personal selling involves two-way communication with prospects and customers that allows the salesperson to address the special needs of the customer. It is often the job of a salesperson to uncover the special needs of the customer. When customers have questions or concerns, the salesperson is there to provide appropriate explanations. Furthermore, personal selling can be directed to qualified prospects, whereas a great deal of advertising and sales promotions are wasted because many people in the audience have no use for the product. Perhaps the most important advantage of personal selling is that it is considerably more effective than advertising, public relations, and sales promotion in identifying opportunities to create value for the customer and gaining customer commitment. The person responsible for management of the field sales operation is the sales manager. He or she may be a first-line manager, directly responsible for the day-to-day management of salespeople, or may be positioned at a higher level in the management hierarchy, responsible for directing the activities of other managers. In either case, sales management focuses on the administration of the personal selling function in the marketing mix. This role includes the planning, management, and control of sales programs, as well as the recruiting, training, compensating, motivating, and evaluating of field sales personnel. Sales management can thus be defined as:
The planning, organizing, leading, and controlling of personal contact programs designed to achieve the sales and profit objectives of the firm.

Today. It is not unusual to compete with companies from other countries. Globalization. The most obvious need for a global perspective is for those companies competing in other countries.S. prepare for. we explore three key reasons for this development—globalization of markets. or to sell to customers that are selling in other countries. to use suppliers located in other parts of the world. Companies that compete only in the United States or even in a region of the United States are feeling the effects of globalized competition. gross national prod- Competition • Globalization • Shorter product cycles • Blurred boundaries Customers • Fewer suppliers • Rising expectations • Increasing power Selling process • Relationship selling • Sales teams • Inside selling • Productivity metrics FIGURE 1-2 Marketplace Changes and Selling Consequences . In the next section we discuss some of the more consequential changes taking place in the marketplace and in selling operations. World trade accounts for more than 20 percent of U. Now it is important that you understand the context in which sales managers execute these two responsibilities. A CHANGING MARKETPLACE It is certainly a time of change. all managers have two types of responsibilities • Achieving or exceeding the goals established for performance in the current period • Developing the people reporting to them Each of these responsibilities includes a number of more specific functions and activities that will be discussed throughout this book. shorter product cycles. and a blurring of market boundaries. Some of the more important competitive and customerrelated forces of change are illustrated in Figure 1-2.001-032_Dal9e_c1 9/19/05 2:47 PM Page 4 4 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT Regardless of whether the sales manager directs salespeople or other sales managers.2 Competition The 1980s and early 1990s were generally a seller’s market. In this section. Few sales forces will be immune. Powerful forces are at work that are irrevocably changing the way that salespeople and sales managers understand. In this section we briefly examine these forces and the consequent changes in selling processes. and accomplish their jobs. Any of these situations may result in intensified competition and require that the sales force adjust from a local to a global focus. the number of competitors in most markets has literally exploded.

This means more traveling. In the late stages of the life cycle. These administrative costs include purchasing and sales call time.3 Blurred Boundaries. As a consequence. Processes and products that were once proprietary are quickly becoming available to competitors. and credit-card companies all compete for the same consumer savings and investment dollars. and developing a global perspective and world-class skills at addressing an increasingly eclectic sales force. These companies are finding that the costs of maintaining relationships with a large number of suppliers far exceed any possible price savings. Banks. the personal relationship and intimate customer knowledge of the sales force become the primary point of differentiation and leverage for a supplier. As a result of the porousness of technology and the increasing number of competitors. General Motors. handling. and most other major corporations have followed suit in reducing their supplier base by one-half or more. Ford. hiring the right people. aluminum. the salesperson again becomes very important.4 Xerox Corporation. The traditional practice of buyers rotating purchases across multiple supplier sources is increasingly being questioned in many industries. and as a consequence. and Avon Products are made outside the United States. Sales and customer relationship skills are most important when a product is new and again when it is late in its life cycle. has reduced its supplier base from 300 to 100 suppliers. paperwork. inventory. defining new roles and duties. and increasing power. imitation is more rapid.00 worth of medical supplies. This is because almost 95 percent of the world’s population and 75 percent of its purchasing power are outside of the United States. Addressing these internal costs associated with procurement and customer inventory holding costs requires a closer supplier-customer relationship than is usually possible when purchasing from a large number of suppliers. product cycles are shorter. receiving. Contributing importantly to increased competition is the phenomenon of boundary blurring: Formerly indirect competitors are entering each other’s businesses. compete for the same application. processing. Customers The increase in competition clearly calls for new selling and sales management approaches. identifying the correct selling and sales management approach is further complicated by customer developments such as purchasing from fewer suppliers. Motorola’s Personal Communications Sector group. and glass. Shorter Product Cycles. The majority of sales by such well-known companies as Coca-Cola. and so forth. leakage. for instance. space. Consider the results of a Department of Defense study which found that it costs hospitals $1. Developments in information and communication technology are often at the heart of boundary blurring. plastic. . Steel. the window of product differentiation has narrowed considerably. However. The rate of technology transfer is increasing. Fewer Suppliers. paper. Chief Sales Officers (CSOs) know that their companies’ growth is likely to depend on how well they manage customer relationships in global markets. for example. insurance companies.001-032_Dal9e_c1 9/19/05 2:47 PM Page 5 A CHANGING MARKETPLACE 5 uct. new Internet companies. sellers are having to call on new decision influencers interested in a new value proposition. mutual funds. New products need careful presentation because a buyer’s risk is highest owing to lack of experience with the product. Colgate-Palmolive. rising expectations. These developments have made it more difficult and complex to sell effectively against a broader set of competitors. With very few important differences in competing products. The sales force’s task is to help customers understand that the benefits of the new product outweigh the risks and costs associated with the requisite business changes.50 in administrative costs associated with $1.

When the accounts are huge. But what if a large customer asks you to address the total cost issues associated with a purchase. according.5 In other words. Power and Associates.6 Relationship Selling. Rising Expectations. to research by J. Customer expectations are raised not just by how well a business performs versus competitors. product and service customization. Procter & Gamble. As a result. the shift by large retailers to single-sourcing has resulted in intense consolidation. and merchandising Increasing Power. brand. Customer satisfaction is difficult to manage because as customers receive good treatment. Target. services. the cleanliness at Disney. customer satisfaction remains low. In this section we briefly discuss several important changes that are taking place in many companies’ selling efforts: relationship selling. both from electronic and human sources. has well over 100 people located in Bentonville. and many other dominant retailers have grown bigger and more powerful than the manufacturers that supply them. Costco. Fewer than 10 percent of all retail stores. Selling Process The changes discussed so far are rapidly dooming the traditional sales attitude of “I can sell anything to anyone. consumer goods companies are finding that marketing and sales must make joint decisions about product. the bar is being constantly raised. and your company has not developed the capacity to do so? You are likely to lose this important customer. Wal-Mart. price. to sell and service Wal-Mart. The value added by the sales force is in communicating the benefits of the prod- . rising customer demands are occurring in a variety of ways. retail sales. the revenue stream from individual customers had become so important that survival had become dependent on maintaining the supplier-customer relationship. for example. In business-to-business sales. account for more than half of U.001-032_Dal9e_c1 9/19/05 2:47 PM Page 6 6 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT At first glance. sales teams. for instance. Pricing. The economic impact of these large accounts requires an integrated approach. In other words. This shift to large powerful customers has had dramatic impact on suppliers. Contract-winning wholesalers rapidly acquired former competitors in an effort to cover larger territories and service larger accounts. for instance. The traditional selling model emphasizes selling products in the short term. and all kinds of support. they become accustomed to it and demand even better treatment. including: • Access to greater levels of information.S. on demand • Ever-increasing speed of response to customer problems and issues • A demonstrated understanding of the customer’s business and issues before being permitted to ask questions • Personalization of offerings. Sears. such as those listed above. Arkansas. Despite a focus on quality and service. and merchandising programs cannot be entrusted to either marketing or sales alone. D. customers purchasing from fewer suppliers would appear to benefit suppliers. People are aware of the standard in the consistency of service at McDonald’s. and they are now dictating the supplier-customer relationship. and the product quality at Sony. but also by the higher standards set in other industries. the number of wholesalers dropped from nearly 182 firms in 1990 to 56 in less than 5 years.” The financial stakes are too high and the problems too complex for a single salesperson to handle. Customers are aware of the product and service quality they receive from these companies and are holding everyone else to a higher standard. What if you are not chosen as one of the “In Suppliers”? Among wholesalers of periodicals and magazines. and productivity.

It is not surprising that some buyers and sellers are not prepared to make adjustments of this magnitude. P&G has reorganized into Customer Business Development Teams composed of a variety of functional areas and organizational levels focusing on individual customer needs. This has led to the development of an alternative selling model referred to as relationship selling. particularly those that are most important.001-032_Dal9e_c1 9/19/05 2:47 PM Page 7 A CHANGING MARKETPLACE 7 Relationship selling model • Emphasis on general management skills • Proactive innovation/opportunity identification and offers • Value-based offers/organizational enablers • Broadened to customers’ customer • Differentiation through people • Profit management focus/share of customers • Trusted business advisor and partner Transactional selling model • Emphasis on sales skills • Responsiveness to customer needs • Good products. Note also that the focus is not on the individual transaction. Notice also that P&G had to reorganize its sales force in order to implement a relationship selling model. As a result. Multiple P&G divisions serviced the same retail accounts. For example. for this program to be successful. . This system has increased customer product turnover by 20 to 30 percent. this type of relationship is appropriate. customers must share critical inventory data with P&G and trust that P&G will operate in the customer’s best interest. A typical career path at P&G is discussed later in this chapter. helping customers make a purchase decision. As the preceding example illustrates. Perhaps the best way to understand what is meant by relationship selling is to see an example of it. many buyers and sellers are finding that this selling model does not work for all customers. virtually every aspect of their sales program had to be adjusted to foster a relationship selling orientation. In fact. Until the late 1980s. relationship selling requires a greater level of trust and commitment by both parties. However. Sellers took orders and aggressively pursued shelf space. Procter & Gamble’s (P&G) sales focus was very transactional. while buyers negotiated fiercely for lowest prices and sought the highest shelving allowances in the form of fees for premium shelf facings. relationship selling involves a collaborative effort to create added value from this synergy. price.7 Of course. A long-term focus is necessary. In contrast. especially when the product or service is not of strategic significance to the buyers. and making the whole process convenient and easy for the buyer. In many situations. buyers and P&G salespeople operated at an arm’s-length buying-selling environment. Figure 1-3 contrasts some of the differences between the traditional transactional model of selling and the new relationship selling model. Relationship selling involves creating customer value by addressing important customer problems and opportunities through a supplier-customer relationship that is much more intimate than that of traditional transactional selling. P&G is able to manage the stock inventory for the retailer or wholesaler in certain high-volume categories through its continuous inventory replenishment system. and service • Narrow customer focus • Differentiation through products • Sales/revenue focus • Traditional customer relationship FIGURE 1-3 Contrasting Transactional and Relationship Selling Models uct or service to the customer. and the retailer often sells the inventory before paying for it.

the importance of the “lone-wolf” salesperson winning and losing on the strength of his or her own efforts and skills is likely to diminish in the future. The Giant Magnetic Resistance (GMR) heads that IBM makes for Traditional buyer-seller interface Buyer-seller interface team Sales Purchasing Sales team Customer team Supplier Customer Supplier Customer FIGURE 1-4 Traditional Buyer-Seller Interface versus a Team Interface .8 Consider the following examples: • A European consumer durable goods manufacturer’s global account manager had negotiated the whole package with one of the company’s global retail customers—product specifications. Inside Selling. teams will require changes in the organization. not all buyers and sellers are prepared to make these adjustments. Sales Teams. so the degree and extent of interaction expand dramatically. Some disregarded the frame agreement altogether. prices. Under the traditional buyer-seller interface model. all of P&G’s capabilities and communications with the retailer were funneled through one salesperson whose customer contact was a purchasing agent. and some local sales managers were not even informed about the global account agreement. The switch to sales teams incorporating a relational sales orientation produces a number of critical consequences in a firm’s sales program and management processes.001-032_Dal9e_c1 9/19/05 2:47 PM Page 8 8 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT The key to successful sales management rests in the ability to strike a strategic balance between relational and transactional opportunities. with multiple contacts being established between P&G and retailers. the model is reversed. Figure 1-4 illustrates the change made by P&G. no one person possesses the necessary knowledge and resources to address the bigger opportunities to create value that go beyond selling the product. • The 3M account manager of the IBM Storage relationship discovered that one of IBM’s major business problems was a manufacturing process that created a disproportionate share of IBM’s costs. training. Obviously. it took P&G 5 years to transition relationship selling and sales teams. In the case of relationship selling. In recognition of its importance. This model allows for a broader transfer of capabilities and communications. supervision. compensation. The result was that global account managers found themselves “policing” the deal all over the globe. selection. and local installation and service agreements. The manufacturer’s sales organization was still managed on a country-by-country basis. We will discuss this issue further in Chapter 2 when investigating strategic sales management issues. As the P&G experience suggests. Certainly. and there is still a commitment to constantly revisit progress and make further adoptions. Local salespeople prioritized the higher-margin business they got through local customers. Even with strong top management commitment and support. With sales teams. As a consequence of the changes noted so far—relationship selling and sales teams—salespeople are spending more of their time marshaling resources and coordinating efforts within their own organizations to address customer problems. we will discuss team building later in this chapter as an important competency for sales managers. and evaluation of the sales force. Notice also that both the seller and buyer must change.

Studies find that trade promotion spending consumes approximately 50 percent of the marketing budgets of these companies and represents about 12 percent of sales. pricing. We discuss these performance metrics further in Chapter 13.9 Productivity Metrics. As a result. display racks. As a result. the 3M sales group had recently been reorganized to address just this type of global customer. Profitability often depends on the following: • • • • • • The amount of time necessary to complete the sale The gross margins associated with the sale The level of price discounting The amount of promotional support The amount of post-sale support The impact of future product sales The sales force has an important influence on all these issues through their account selection. sales to IBM Storage increased 300 percent over 2 years. salespeople are being evaluated on a wider array of performance metrics. The breadth of skills and knowledge required to excel in sales has increased dramatically. Fortunately. which translated to IBM’s annually saving several million dollars. and servicing decisions. Salespeople will need to work with a number of functions across an organization if they are to develop successful long-term relationships with clients like the one between 3M and IBM. In effect. generating more than $10 million in incremental revenue.10 Spending this money effectively is critical to these firms’ profitability. These decisions and the metrics for making them are discussed in Chapter 4. Thinking that proprietary 3M technology could help address the ESD problem. In the next section we try to provide a picture of what sales management is all about by first describing the functions . Historically. For example. salespeople are resource allocators. such as coupon promotions. companies are discovering that not all sales are equally profitable. Sales managers typically rewarded and compensated salespeople by evaluating sales volume over a certain period of time. sales performance metrics were simple—increase revenue over the previous year. and price promotions. The account manager coordinated the various 3M resources required at the San Jose IBM design facility. the sales force also has an important role in the allocation of marketing resources to individual customers. Inside selling is especially important for strategic and global account selling. As a consequence. IBM eventually asked 3M to supply them with the manufacturing system components multinationally. Jan brought in a core group of four people from 3M’s Technology Group to study and solve the problem. That group spent over 2 years creating wholly new static-dissipative materials to optimize their performance in the manufacturing of GMR heads. newspaper advertising. account penetration. sales is becoming an important proving ground for top marketing and operating officers in many companies. which places greater emphasis on gathering more and better performance data. sales forces for large food manufacturers selling through grocery stores are responsible for trade promotion spending decisions. First. it is an exciting time to be in sales and sales management. Although sales volume is still important.001-032_Dal9e_c1 9/19/05 2:47 PM Page 9 A CHANGING MARKETPLACE 9 computer hard drives are extremely sensitive to the electrostatic discharge (ESD) that is created during manufacturing. they decide on which customers and prospects they will spend time selling and how much time they will allocate to each customer. Companies are beginning to realize that in many cases sales success depends as much on successful inside selling as it does on external customer-focused selling. Second. Through these efforts. account retention. 3M reduced IBM Storage’s GMR product loss by approximately 10 percent. As indicated at the beginning of this chapter.

he found there were no systems to help a salesperson convert leads into a sale. company products get proper representation.11 To better understand how sales managers execute these responsibilities. salespeople sold advertising space on price rather than value. and finally the competencies a successful manager needs to develop. This text is organized around the steps in this sales management process. and the competencies needed to be a successful sales manager. in this section we describe a fundamental process for sales management. chaos reigns and field reps merely react to customer requests rather than help them solve problems. Put together. when Parke-Davis launched its blockbuster cholesterol-lowering drug. 30 percent sales and product leadership. When Filemon Lopez looked at the selling process at Comcast Cable. and creating value for individual customers. and he hired telemarketers to get leads for field reps. To be successful and produce profitable results. the two primary responsibilities of sales managers are to achieve their firm’s goals for the current planning period and to develop the people reporting to them. Lipitor.001-032_Dal9e_c1 9/19/05 2:47 PM Page 10 10 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT they perform. Roles of the Sales Force. Focusing on the Big Picture. a firm’s business strategy and market access strategy must be implemented by the sales force. The sequence of activities that guides managers in the creation and administration of sales programs for a firm is known as the sales management process. THE SALES MANAGEMENT PROCESS As stated earlier. and the sales force is stretched but not overworked.12 There were no territories. Physicians have consistently ranked Pfizer’s sales force as one of the best in the pharmaceutical industry. Sales force investment is primarily a function of properly sizing the sales organization to assure that customers and prospects receive appropriate coverage. analyze needs. and a firm’s strategic sales force program is discussed in Chapter 2. it entered into an alliance in which Pfizer’s sales force pitched the drug to physicians throughout the United States. One field sales manager described the job as follows: People development is my main mission in life: 50 percent people development. As a result. and 10 percent compliance—you go to jail if you are not the policeman on the block. A company’s management process is fundamentally affected by the firm’s overall business strategy and its strategy for accessing its target markets. Chapter 2 and sales forecasting and sales force investment constitute the “Big Picture” focus of top sales force executives. managing customer relationships. An effective sales force is a powerful asset for any company. strategic plans are implemented through the activities and behaviors of the sales force. Lopez instituted training classes showing reps how to prospect. The role of the sales force . and lead generation was haphazard. The relationship between business strategy. reps know what steps to follow and sales revenue is up 20 percent. Key sales force behaviors include calling on certain types of customers and prospects. Now that Comcast Cable has a defined sales process. The appropriate investment in the sales force will also depend on the size of the opportunity a firm faces and its expected sales level. 10 percent administration. solve problems. Each step is briefly described here. When managers fail to follow a defined sales management process. Two management resource presentations follow Chapter 2: sales force investment and sales forecasting. and make value-driven sales. followed by a discussion of the activities in which they are involved. He also established sales territories so that reps were not competing with one another. a firm’s marketing strategy. In other words. the activities in which sales managers are engaged.

These and other recruiting issues are covered in Chapter 7. Because sales training is expensive. and benefits without putting the firm’s profitability in jeopardy. and customer interactions (Chapter 5). Leadership styles vary. and defining expectations. recruitment. that is. a sales force must be well organized. Good sources must be found for new hires. Together. while achieving the revenue goals of the firm (Chapter 9). salespeople’s competencies are usually developed through training before they are sent into the field. these chapters examine the activities and behaviors of successful sales forces. Sales managers are responsible for making sure that training is completed. Leading the Sales Force. Sales managers use a variety of tools in their efforts to motivate salespeople to work more efficiently and effectively. enforcing rules. location. Alternative sales force structures are presented. In turn. Salespeople are continually confronted with ethical dilemmas. the sales manager is responsible for selecting the most cost-effective methods. with some time devoted to development of selling skills. A key task for sales managers is to devise an effective mix of salary. and they often conduct some of the classes. sales management activities such as compensation. The chapter also discusses other techniques that have proved to be effective motivators. and recognition awards. and materials. expenses. Money is an important consideration for attracting and motivating people to work hard (Chapter 12). Following this chapter is a management resource describing a process for aligning sales territories. training. and product line breakdowns (Chapter 13). assigning customers to salespeople. In addition to leading the sales force in business results. setting goals. In addition to hiring qualified people. Good leaders provide models of behavior for employees to emulate. services. account relationships (Chapter 4). It also means reviewing selling costs and measuring the impact of sales force activities on profits. Structuring the Sales Force. often developing strong mutual trust and rapport with subordinates. and operating procedures. commissions. and their implications are discussed in Chapter 6. quotas. sales managers are also expected to lead by example in encouraging ethical behavior within the sales force. A detailed discussion of training is given in Chapter 8.001-032_Dal9e_c1 9/19/05 2:47 PM Page 11 THE SALES MANAGEMENT PROCESS 11 in implementing a firm’s market access strategy is the focus of the second section of this text. but effective leaders are adept at initiating structure—that is. including sales meetings. organizing and motivating employees. and evaluation are affected. The most powerful motivator for salespeople is often a well-designed compensation package. Most initial training programs are designed to familiarize salespeople with the company’s products. sales contests. The final step in the sales management process is to evaluate the performance of the sales force and develop the skills of their people. Building Sales Competencies. Sales managers provide leadership by inspiring people to grow and develop professionally. Chapter 11 describes a proven process for achieving goaldirected effort. Sales force structure decisions influence how customers see the firm because sales force structure will affect the selling skills and knowledge level required of salespeople. bonuses. This involves analyzing sales data by account. and those who are weak in these areas must be carefully screened out. To meet customer needs efficiently and effectively and to sell the firm’s products and services. Chapter 10 provides some background on these problems so that informed decisions can be made. Sales managers are responsible for hiring salespeople with the appropriate skills and backgrounds to implement the sales strategy. Based on the prior discussion of the sales manager process which person would you promote in the Team Exercise “Who to Promote?” . territory. This section is organized hierarchically to first look at managing multiple sales opportunities (Chapter 3). Effective sales managers know how to supervise and lead their salespeople.

Assume you are the vice president of sales. You also do not want to lose one rep by promoting the other. Let’s examine the dimensions of each of these competencies more closely. After adding 10 new salespeople. Often these inserts are examples from actual companies. STEVEN BELLACH Steven is a 6-year veteran with the company and a solid producer who is looked up to by many of the younger reps. Introducing the new product has also had salespeople working double-time. He is great at building customer relationships and always has supportive words and suggestions for his peers on how to improve their sales techniques. exercises are included at the end of each chapter focusing on each of the six competencies. and she has had great success with the two rookie reps she has mentored. with sales jumping an average of 60 percent per month because of the added exposure a new product. He is surprisingly detail oriented for a salesperson. you have been spending most of your time interviewing and hiring new salespeople. Here we focus on six competencies (Figure 1-5) that you will need for today’s sales management responsibilities. To help you in this process. So. but also someone who can maintain records and budgets as if the area were his or her own business. skills. StarDuster. In addition.001-032_Dal9e_c1 9/19/05 2:47 PM Page 12 12 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT TEAM EXERCISE “Who to Promote?” Your company has experienced fantastic growth during the past year. Sales management competencies are defined as sets of knowledge. won’t take “no” for an answer. but you may be wondering what it takes to be an outstanding sales manager. you realize that you need to promote one of your senior reps to be an area sales manager. Lately. and attitudes that a person needs to be effective in a wide range of industries and various types of organizations. Strategic Action Competency. You want to choose the person who will keep sales growth high and the reps motivated. Her dynamic personality is an inspiration to other reps. Her “take-charge” personality has been of benefit to you and you have often asked her to help you plan sales meetings. Which would you choose to promote to manager and why? Remember to consider the duties of a sales manager and the skills that sales managers need to perform effectively. THE SALES MANAGEMENT COMPETENCIES We’ve talked about the sales management process. we have included inserts into each chapter describing these competencies in the context of the chapter’s subject matter. so how would you handle the discussion with the person you do not promote? LISA BELL Lisa is very persistent. his sales reports are always filled in perfectly and turned in on time.13 People use many types of competencies in their everyday lives. She has been a President’s Club member (top 10 percent in sales each year) every year since she was hired 5 years ago. has given to all of the company’s other products. Strategic action competency includes: . behaviors. and is one of your best closers. You have narrowed your choices down to the following two people. let’s look more closely at the competencies that managers need in order to succeed. Keeping these six sales management competencies in mind will help you remember how the material you are studying can improve your performance on the job. Understanding the overall strategy and goals of the company and ensuring that your actions and those of the people you manage are consistent with these goals involves strategic action competency.

sales of Encyclopaedia Britannica peaked in 1990 at $650 million.300 people. a strategy or plan for achieving specific goals must be developed (Chapter 2). which will have implications for how resources are allocated across various market opportunities (Chapter 3). Britannica’s management failed to respond and continued to market through a direct sales force of 2.001-032_Dal9e_c1 9/19/05 2:47 PM Page 13 THE SALES MANAGEMENT COMPETENCIES 13 Strategic action competency Technology competency Global perspective competency Sales management effectiveness Coaching competency Teambuilding competency Self-management competency FIGURE 1-5 A Model of Sales Management Competencies • Understanding the industry • Understanding the organization • Taking strategic actions Today’s sales managers are being challenged to think strategically in order to improve their job performance.14 This competency also involves understanding the organization—not just the sales unit in which the manager works. the company is in financial trouble. As CD-ROM technology gained acceptance. Unless you are well connected and can influence them. First published 225 years ago in Edinburgh. Part of the reason Britannica found it hard to change is that a typical sale pays the salesperson a commission of $300. Like the athletic coach. “Dimensions. With CD-ROM encyclopedia packages priced from $99 to $395. direct mail. and how the account interaction is executed (Chapter 5). The plight of Encyclopedia Britannica Corporation is a good example of the possible penalty for ignoring important industry trends.15 The president of a large distribution company developed the habit of calling a district sales manager into his office and bringing up an account . however. what types of customer relationships are developed (Chapter 4). One dimension of strategic thinking is to anticipate strategic trends in the industry and to make the appropriate adjustments to take advantage of these changes. The first five chapters of this text are organized to reflect the hierarchical nature of goals. Failure to do so may be very costly. your point of view goes unheard at the top. After examining the competitive environment (Chapter 1). strategies. Goals and standards will cascade from above. and tactics. and telemarketing.” Coaching Competency. with profits of $40 million. whereas salespeople compete with other companies’ salespeople to win accounts. a change the powerful direct sales force would have resisted. For more details about strategic action competency. and the sales force is now less than half its former size. Comparisons are often made between the competitive worlds of sports and business sales. commissions would have dropped significantly. It also would have required marketing through competing channels of distribution such as retail outlets. Athletes compete against opposing players to win the game. refer to the Strategic Action Competency box. Sales have declined drastically. Scotland. the sales manager plays an important role in this competition by helping to develop the skills of the sales team.

and product and market knowledge. managers were unprepared. helping salespeople build better customer relationships became a priority among the district managers. In this role. but as soon as the message was understood. This process often includes providing ongoing training and coaching in selling skills. At first. According to one successful sales manager: . sales strategy. Coaching is defined as a sequence of conversations and activities that provide ongoing feedback and encouragement to a salesperson or sales team member with the goal of improving that person’s performance. rather. retention. Soon other senior officers began copying the president’s actions. The best coaches don’t tell salespeople what to do. He then asked the manager to comment on what he or she had done to support the salesperson’s relationship-building efforts in that account. they collaborate with them to achieve mutually agreed-upon goals. He wanted to reinforce the importance of this management responsibility. Performance improvement is achieved by • Providing verbal feedback • Role modeling • Building trust Coaching helps salespeople develop through one-on-one feedback and encouragement. Successful sales coaches also provide a role model of positive example through their own behavior or that of others. He didn’t tell the district managers how to help salespeople build better account relationships. overall strategy.001-032_Dal9e_c1 9/19/05 2:47 PM Page 14 14 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT STRATEGIC ACTION COMPETENCY “Dimensions” Understanding the Industry • Understands the history and general trends in the industry and their implications for the future • Stays informed of and anticipates the actions of competitors and strategic partners • Identifies attractive market segments and their buying needs Understanding the Organization • Understands the vision. and goals of the organization • Appreciates the distinctive competencies of the organization with respect to market opportunities and limitations • Understands how to marshal organizational resources to meet the needs of the customers Taking Strategic Actions • Assigns priorities and makes decisions that are consistent with the firm’s mission and strategic goals • Implements specific account selection. Sales coaching. however. involves more than just providing verbal feedback on what a salesperson has done. a sales manager works with each person to create and implement a developmental plan to improve performance. and dominance strategies • Develops an appropriate portfolio of account relationships • Considers the long-term implications of actions in order to sustain and further develop the organization • Establishes tactical and operational goals that facilitate the firm’s strategy implementation on his computer.

18 Increasingly. and shows a genuine concern about the needs of the salespeople. and appropriate risk taking • Adds value through communicating relevant selling experiences • Helps salespeople to “look good” through two-way communications . until they know you care. or an important victory • Reinforces success and positive attempts to support desirable behaviors Role Modeling • Leads by example rather than decree • Provides role models. refer to the Coaching Competency box. the Hay Group found that two of every three companies plan to increase their level of employee participation in teams.001-032_Dal9e_c1 9/19/05 2:47 PM Page 15 THE SALES MANAGEMENT COMPETENCIES 15 I believe in the power of personal example. a salesperson must be open to coaching. Sales managers in companies that utilize sales teams can become more effective by • Designing teams properly • Creating a supportive environment • Managing team dynamics appropriately In a recent study of 243 employees. collaboration. Allegiance Healthcare recognizes that COACHING COMPETENCY “Dimensions” Providing Verbal Feedback • Provides specific and continuous performance and selling skills feedback • Builds a feeling of appreciation and recognition by taking the time to acknowledge a job well done. they must provide systemoriented solutions to a customer’s business problems. and shares best practices • Models professional attitudes and behaviors Trust Building • Maintains good rapport with the sales team and fosters open communications. Still. “Dimensions. two-way channel of communications. This is achieved by listening and maintaining an open. This requires a level of trust between a salesperson and a sales manager. initiative. taking feedback constructively. creativity. an effort beyond the call of duty.” Team-Building Competency. and following the sales manager’s example. but the most effective way to get results is to show someone what you want done. either themselves or others. The primary reasons for the change are to improve customer service and productivity. Accomplishing tasks through small groups of people who are collectively responsible and whose work is interdependent requires a team-building competency. You can rant and rave and threaten. As the saying goes: “They won’t care what you know. companies are realizing that they are not selling a product. to remain competitive.17 A climate of trust is created when a manager is honest and reliable.16 Many sales managers believe that being a good role model is the most effective way to gain the respect of their salespeople.” For more details on dimensions of coaching competency.

some companies conduct interviews with team members as a crucial part of their hiring process. it can destroy the team. if managed poorly. which means that managing team dynamics is necessary for effective team building. This means that it is very important to hire people who can get along with others and who work well within a team environment. but it needs a supportive environment to achieve its full potential. With an in-depth understanding of its customer’s internal operations. Conflicts and disagreements among team members are natural. A recent study concluded that approximately 25 percent of the performance of sales teams was a function of the diversity within the sales team.19 Successful team development undoubtedly will require team training. team members are empowered to take actions based on their best judgment.001-032_Dal9e_c1 9/19/05 2:47 PM Page 16 16 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT the foremost mission of its hospital customers is the care of patients. Taking responsibility for your actions at work and elsewhere involves self-management competency. however. A well-designed team is capable of high performance. Marketing liaisons analyze product-specific data such as usage trends and pricing options. For more details about the team-building competency. Allegiance enables its customers to focus more closely on their mission by providing the support of a wide range of functional experts. people often blame TEAM-BUILDING COMPETENCY “Dimensions” Designing Teams • • • • Implements an organizational architecture that will support teams Creates a reward system that is fair within the context of a team effort Coordinates team goals with the overall goals of the organization Coordinates team activities with the requirements of functional areas within the organization Creating a Supportive Environment • Hires people who will be successful in a team environment • Trains with programs that encourage teamwork • Integrates the individual members of the sales team together to form a functioning and supportive team Managing Team Dynamics • Understands the strengths and weaknesses of team members and uses their strengths to accomplish tasks as a team • Facilitates cooperative behavior and keeps the team moving toward its goals . whereas information service specialists help customers with their information systems needs. Financial experts monitor regional economics. this means maintaining cooperative relationships while pursuing a common goal. In fact. “Dimensions.” Self-Management Competency. which is necessary to allow team members to assume each other’s roles and to work interdependently. These salespersons are quite different from the traditional salespersons who survived by relying on their own abilities. refer to the Team-Building Competency box. If managed well. Essentially. conflict can be productive. In a supportive environment. with more diverse sales teams expressing greater job satisfaction. When problems arise. the Logistical Support Group can offer improvements that will streamline customers’ logistical processes.

instituting formal ethics training programs. How is it possible to respect people you feel have no integrity and do not conduct themselves ethically? As a person who influences or controls the rewards salespeople receive. hiring ethical consultants. developing corporate cultures that encourage ethical behavior is becoming a prominent concern of management. one manager responded as follows to the question of what satisfied him: What satisfies me about the job? Well. At the same time. Effective managers don’t fall into this trap. the energy and commodities trading company which in 2001 became one of the largest bankruptcies in U. they are more likely to model this behavior. you do get feedback. there is increasing emphasis on ethical professional behavior. reached an agreement with federal and state securities regulators on settling a securities fraud case that hinged on misleading sales documents distributed to brokers and passed on to customers. Consider the following examples: • In 1994 Prudential Securities Inc.. Ethical conduct by managers is critical to developing an ethical corporate culture. On a typical day. After being promoted to sales management a year earlier. the largest for-profit hospital company in the United States. The settlement would ultimately cost Prudential in excess of $1. • Columbia/HCA Healthcare Corporation. The scandal led to proposed reforms in accounting practices and in regulations governing 401(k) retirement plans. Who is going to come in with the real hot one today and how do I escalate myself to listen to that one today because I can’t listen to all eight or nine? A sales manager’s job is more than just balancing the many issues that arise each day. Self-management competency includes • Integrity and ethical conduct • Managing personal drive • Self-awareness and development Sales managers are in a particularly sensitive position with respect to integrity and ethical conduct. has been accused of improperly inflating costs in reports to the government and pocketing more Medicare reimbursement than warranted. a manager’s ethics and integrity are constantly under review. and maintaining standing ethics committees. The most important part of his or her job is achieving a balance between personal goals and those of the organization and of the people they manage. Industry sources predict that Columbia will pay a $1 billion fine. Sales managers are involved in a constant balancing act.S. the sales force must trust and respect a sales manager. As the leader of the sales team. Companies are developing and enforcing codes of ethics. formerly Prudential-Bache Securities. Perhaps because of the size of these judgments.4 billion.001-032_Dal9e_c1 9/19/05 2:47 PM Page 17 THE SALES MANAGEMENT COMPETENCIES 17 their difficulties on the situation or on others. The U. history and the focus of a major scandal due to accounting fraud. and important penalties are associated with unethical behavior. salespeople take their cues from the sales manager with respect to the ethical treatment of customers.S. • Enron Corporation. Every month you can see how much your team has generated and you can see which people have developed and maybe even been . If salespeople are aware of instances in which a sales manager has bent the rules to make a sale to one customer. To achieve success. while committees in the U. they will work on many problems simultaneously from the insignificant to the important.S. Department of Justice opened a criminal investigation that targeted top Enron executives and the accounting firm of Arthur Anderson & Company. In the words of one new sales manager: You have eight or nine people looking for your time … coming into and out of your office all day long. Senate and House of Representatives began separate probes into the company’s conduct.

This begins with the reason for wanting to be a sales manager in the first place. The Self-Management Competency box.21 To help you in your own self-awareness. demanding. it’s likely that you will work for an organization that has a global sales component. You know you are doing something that is important to the company. and material resources from multiple countries and serving customers who span multiple cultures requires a global perspective competency. you should begin to develop your global perspective competency. the opportunity to assume more authority and make more money. The Developing Your Competencies section at the end of this chapter poses challenging problems and self-assessment exercises. a number of self-assessment exercises have been included in the following chapters. For instance. consider the comments of one sales manager: With clients you have to decide quickly. You can’t judge so quickly when trying to read your own people. information. At first glance. They saw me as a dictator. including being tired of their present job. But after three weeks on the job. I made them nervous because I seemed timid. because you’ll have to trust them. A number of experiential exercises are suggested at the end of the chapters along with in-class exercises in which the feedback from other students and your instructor will be helpful in developing self-awareness. there appears to be quite a bit of overlap in what one does as a salesperson and as a manager. People are attracted to management for a variety of reasons. practical challenges are also posed in each chapter’s Team Exercises. Drawing on human. a tyrant on their backs. The best way to develop self-awareness. interested. is to do something: take some action. and involved.001-032_Dal9e_c1 9/19/05 2:47 PM Page 18 18 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT promoted. “Dimensions. I needed to soften. • What an eye-opener. harsh. To be prepared for such an opportunity. your own culture has become second nature to you. Perhaps the biggest adjustment that new sales managers must make is understanding the difference between selling customers and leading salespeople. something that needs to be done—both making money and helping people grow and move—both aspects bring their own satisfactions.” provides more details about this competency. which in sales is reflected in • Cultural knowledge and sensitivity • Global selling program By the time you become a sales manager in your home country.20 Self-awareness is a critical element of being a good sales manager. you probably have much less general knowledge . Real-word. It can’t be superficial. You make quick. People were trying to tell me I was too indecisive. however. • I was just being myself. You need to really get to know what they’re like. financial. unless you have traveled extensively. How would you handle the issues posed in “How to Handle Rumors”? Global Perspective Competency. both the salesperson and the manager must be good listeners and know how to take decisive action. Not all companies compete in global markets or service customers who sell throughout the world. To understand the difference between the two situations. or studied other cultures as part of your education. However. which are designed for small teams to tackle. but during the course of your career. it was coming back to me that people thought I was harsh. in one or two meetings of twenty minutes or so. No one had ever called me timid before. and the opportunity to exercise power and influence. New managers quickly discover that these reasons don’t help them much in the day-to-day life of a sales manager. judgments. which often leads to self-doubts and a focus on the question of “Will I be good at it?” Following are comments from three new sales managers regarding what they discovered about themselves through their salespeople: • I saw my style as very aggressive. what you think of them. almost snap. You’re constantly reading people.

After thanking your salesperson for telling you about this. She also was insulted by the suggestion that she’s one of the customers being duped by your company. feelings.001-032_Dal9e_c1 9/19/05 2:47 PM Page 19 THE SALES MANAGEMENT COMPETENCIES 19 SELF-MANAGEMENT COMPETENCY “Dimensions” Fostering Integrity and Ethical Conduct • Has clear personal standards that serve as a foundation for a sense of integrity and ethical conduct by the sales team • Projects self-assurance and doesn’t just tell people what they want to hear • Is willing to admit mistakes and accepts responsibility for own actions Managing and Balancing Personal Drive • Seeks responsibility. Will other customers react as this one has? What about prospects—how will they react? Have other customers heard this story and not told your salespeople? What. but doesn’t put personal ambition ahead of the organization’s goals • Understands that goals are achieved through the success and development of the salespeople Developing Self-Awareness and Management Skills • Has clear personal and career goals and knows own values. which implies that she isn’t doing her job properly. as a sales manager. Your salesperson indicated that this particular long-time customer was unmoved by the competitor’s accusations and. if anything. in fact. works hard. should you say anything at your next Monday morning sales meeting with your sales team? If so. you head back to your office to consider what to do with this information. such as updates of new parts before old parts are worn out. and areas of strengths and weaknesses • Analyzes and learns from work and life experiences • Is willing to continually unlearn and relearn as changed situations call for new skills and perspectives TEAM EXERCISE “How to Handle Rumors” One of your salespeople tells you about an interesting conversation he had this morning with a long-time customer about a competitor’s salesperson who used to work for you. should you do now? In addition. and is willing to take risks • Shows perseverance in the face of obstacles and bounces back from failure • Is ambitious and motivated to achieve objectives. thought that his approach was in bad taste. He also added that your make-quota-or-leave mentality is forcing reps to push products that customers don’t really need. but was discharged for underperforming. He told the customer that the quality of your company’s products had diminished significantly in recent years and that consequently your salespeople were having a hard time selling to prospects and are relying on past reputations to sell to current customers. The sales rep had criticized your company and you. what will you say? .

global issues are discussed in each of the following chapters. many managers are now expected to develop a knowledge and understanding of at least a few other cultures. Technology Competency. and cultural backgrounds . One study reported that sales executives rated up to 50 percent of expatriates as ineffective or marginally effective. increased sales force productivity by 25 percent through the use of a handheld wireless activity inventory system to take the inventory of retail stores automatically. Selection. when to schedule appointments. purchase and redeem fund shares. The Vanguard Group offers a Web interface that is accessible to both customers and the sales force. for instance.” provides more information on the dimensions of this competency.22 Selling globally or to global accounts affects almost everything a sales manager does. a marketer of golf equipment. Customers use it to open new accounts. Consider the following examples in which technology has significantly increased sales force productivity: The TaylorMade Company. asking the right questions. The skills component of their training programs emphasizes that listening. and gain access to account performance. “Dimensions. even those that share a border with your own country. Wyeth-Ayerst International sells pharmaceuticals in 100 countries and employs 50 international sales trainers. Salespeople are taught when to drink tea. the company adapts training to local conditions in response to cultural differences. The sales force is freed up to devote time to GLOBAL PERSPECTIVE COMPETENCY “Dimensions” Cultural Knowledge and Sensitivity • • • • Stays informed of political. such as where the company is marketing its products or where customers are selling their products.001-032_Dal9e_c1 9/19/05 2:47 PM Page 20 20 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT and understanding of other countries. allowing salespeople more time to focus on helping retailers increase sales. For example. and probing for needs are the same throughout the world. ethnic. becomes more difficult. Yet because business is becoming global. Understanding the potential for technology to improve sales force efficiency and effectiveness and knowing how to implement the integration of technology into the sales force is referred to as possessing technology competency. The Global Perspective Competency box. and when to close. competency creation.23 Coordination also becomes problematic as issues arising between sales efforts at global headquarters and in individual regions and locations are exacerbated. and motivation systems to the local culture • Appropriately adjusts own behavior when interacting and managing people from various national. social. Nevertheless. In recognition of this complication. and economic trends and events around the world Recognizes the impact of global events on the market and the organization Has sensitivity to cultural cues and ability to adapt quickly in novel situations Travels regularly and has a basic business vocabulary in languages relevant to the position Global Selling Program • Understands the selling situations in which a global selling effort is needed • Adopts an appropriate sales force architecture for global accounts • Appropriately adjusts sales force measurement.

In the next stage. as well as a company’s partners. management has not clearly identified and communicated what they want to accomplish. Experience shows that when the balance shifts to management control and data collection from increasing sales-rep productivity. Vanguard’s Web customers invest 150 percent more than non-Web customers.001-032_Dal9e_c1 9/19/05 2:47 PM Page 21 THE SALES MANAGEMENT COMPETENCIES 21 higher value interactions. In addition to the box inserts and end-of-chapter questions focusing on technology. SFA and CRM can streamline a company’s entire selling process. In the first stage. makes an inquiry over the phone. Technology competency includes: • Understanding the productivity potential of new technology • Implementing sales force automation (SFA) • Implementing customer relationship management (CRM) Many experts consider the integration of communications technology. Unfortunately.24 Sales and marketing adoption of technology tends to evolve over the years. Because the opportunities for integrating technology into the selling function are so widespread and important and because management plays such a vital role in the successful implementation of SFA and CRM. Second. each of which causes sales force resistance. 83 percent of respondents’ companies plan to upgrade existing sales and marketing service and customer relationship management systems. When implemented correctly. finance. One reason for resistance is that the sales force does not understand how SFA and CRM will help them in their efforts to sell. we consider technology competence a sales management competency. marketing.5 million. sees a technical specialist for product design assistance. and estimated 61 percent of automation projects fail to deliver the expected benefits. more commonly known as sales force automation (SFA). the sales force will resist. If a customer gets product information over the Internet. According to a recent survey of top sales executives. Sales. a company may adopt a customer relationship management perspective to technology in recognition that a firm’s relationship with a customer is a many-to-many relationship. CRM systems seek to ensure that all the parties have the same information for seamless collaboration. The companies we have talked with and the sales managers who have been chapter consultants for this text have indicated that they expect their new hires to have a . it is still almost a badge of honor among top corporate officers to not know how to use their own personal computer. In the third stage. A major focus of CRM systems is to ensure a consistent experience for a customer across multiple sales channels. Although most companies can’t afford not to automate. sales management may expect SFA and CRM to allow better control of remote and mobile salespeople.26 In other words.25 According to experts. The average budget companies have slated for these initiatives is $1. as not only a source of competitive advantage but increasingly as a necessity to stay competitive. Third. product development. and sees a salesperson for pricing information. This helps companies be more effective in communicating with a customer and more efficient in transacting business. Research indicates that appropriate technology training and improved salesperson effectiveness will cause resistance to technology and job insecurity to abate. problems have been included in the appropriate chapters accompanied by Excel spreadsheets. resistance is likely when top management is not committed to automation by adapting technology themselves. and the cost to serve them is just 5 percent of what is spent with a human interface. service. all need to collaborate and share information in order to meet customer needs. a company may adopt an electronic territory management system to increase sales force effectiveness by assisting with targeting and customer profiling. sales force automation systems often focus on efficiency and consist of call reporting systems focused on tracking activities that are designed to automate repetitive and errorprone sales tasks such as order processing. company efforts to automate are jeopardized by one of three reasons.

she joined Bell Atlantic.28 Following is one person’s story. Cash took a position with a software company. she started taking on additional projects that utilized her experience. Many selling and sales management experts will testify that there is a significant positive correlation between salespeople’s success and the quality of their sales manager. She was hired as East Coast sales manager of Princeton Softech in 1997. In 1992. She worked her way up to regional sales and marketing manager by 1991. The median age of newly appointed first-line field sales managers is about 35 with about 6 to 7 years of prior sales experience with the company. which is why we have included the problems along with Excel files for your analysis. see the Technology Competency box. We believe it is important for students to understand how someone moves into the position of sales manager and what the opportunities are for further advancement. “Dimensions. For more on technology competency. Intrigued by the fast-growing high-tech sector. where she managed two separate $100 million divisions. One of these projects was .” CAREER PATHS Sales is a great way to start a career. The Path to CEO Lisa Cash started in sales with Club Corporation of America in the early 1980s. The bottom line is that you can make a difference with a career in sales management. new sales managers are often able to boost the sales of the salespeople they supervise. That the average total compensation for sales managers is $144. After a short time. now Verizon.001-032_Dal9e_c1 9/19/05 2:47 PM Page 22 22 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT TECHNOLOGY COMPETENCY “Dimensions” Understanding of New Technology • Awareness of the potential for technology to increase sales force efficiency and effectiveness • Experience in using new technology • Attitude toward adopting new technology Implementing Sales Force Automation • Knows what is to be accomplished and the possible benefits • Adapts personal management style and procedures • Fosters sales force acceptance and use of selling technology Implementing Customer Relationship Management • Develops clear project objectives that are business focused and realistic • Understands the processes that will be affected by CRM and the data needed for these processes to be improved • Understands and sells the benefits of the system and how it can be used basic proficiency in the use of spreadsheets.27 Because of their enthusiasm and fresh ideas.653 also testifies to the importance of this position. Sales managers almost always begin their career paths as salespeople.

The account executive level influences P&G brand decisions at the customer headquarter level. devel. When the company’s CEO decided to leave. “I think we are seeing more CEOs from sales and marketing because they have highly developed communication and persuasion skills. The sales force is a part of the Market Development Organization. Sector/ multi-sector sales Human resources Other functions • Advertising • Product supply • Management system • Human resources • Finance • Other Associate director Customer business development Sector/ multi-sector bus. either as a part of an account team or a geographic unit. the role of sales is to deliver brand volume and market share at a competitive cost. As you can see in the figure. is responsible for influencing decisions affecting P&G brands at individual retail outlets. it was Cash he recommended to replace him. which eventually led to an appointment as vice president of sales in 1999. At P&G. An account manager is expected to develop and execute merchandising and promotional programs that grow the profits and sales for the customer and the brand. there are only four levels of management below the executive management level. where trainees gain valuable experience that becomes the springboard for promotions. An associate director is responsible for Executive management Function management–general management Director Customer business development Worldwide assignments • Canada • Latin America • Asia/Pacific • Europe • Middle East & Africa • U.S.”29 Procter & Gamble Sales careers with consumer product firms begin in the field. According to Cash. An account manager. Sector/ sales merchandising Human resources Manager Operations manager Geographic or team account executive Other field or general office roles Account manager Operations manager Geographic or team account executive Other field or general office roles FIGURE 1-6 Career Paths at Procter & Gamble . And they have a high level of awareness about the importance of the customer. while also coordinating local store activities of the account managers. which is organized as shown in Figure 1-6.001-032_Dal9e_c1 9/19/05 2:47 PM Page 23 CAREER PATHS 23 implementing a telemarketing channel (outbound sales calls) for the company.

Each chapter begins with a company or individual vignette introducing many of the concepts and issues discussed in the chapter in a live situation. and functional strategies in a particular business sector. Each exercise relates to the chapter’s topic and is designed to help you build your competencies so that you are prepared to assume sales management responsibilities when the opportunity is presented. This first case describes the company. Procter & Gamble Distributing Company. Key terms are presented in italics and are listed at the end of each chapter. customer. In addition. the development of sales force competencies. J. and Joseph Clayton. You are given the opportunity to grow with Doug as he faces challenges described at the end of each chapter. A key advantage of a career at P&G is the wide variety of positions available that provide experience needed to climb the ladder of success. Again. Success in business is directly related to the competencies that you develop.001-032_Dal9e_c1 9/19/05 2:47 PM Page 24 24 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT all the brand. PREPARING FOR SALES MANAGEMENT SUCCESS Sales Management was written to prepare you for a successful sales management career. wholesale clubs. Each situation calls for you to decide the most appropriate action to be taken and often includes the opportunity to think about the words and phrases you would use when talking with the other people in the exercise. B. such as major food distributors. After several years. These six competencies have been identified as important for success in management. its products. national chains. To illustrate the relevance of each competency to sales management in particular. To accomplish this objective. To further help in your development. each chapter includes several Team Exercises describing typical situations in the day-to-day life of a sales manager. Opportunities for personal growth and development may be found within each of the four organizational levels at P&G. Chairman of the Board. as well as the “growing pains” Doug goes through in those first months as a sales manager. On the first page of each chapter is a list of Learning Objectives for that chapter. Sales Operations Business Unit Executive. This promotion might be followed by an assignment in Europe or in human resources as a trainer. Sirius Satellite. Director-Sales-Marketing. They have passed along the lessons they have learned to help you be a success. a new recruit might start as an account manager in the Midwestern Kroger customer team. four of the competencies as exercised by real companies or individuals are described in boxed inserts in the body of each chapter of this book. along with a brief description of the topic. IBM Corporation. you are asked to make decisions based on the background information presented in the chapter. The remaining chapters build on the competencies introduced in this chapter. Paulette Turner. Following this chapter is the D & M Insurance Company case describing Doug Bloom’s first days after being promoted to sales manager in a financial services company. and discounters in a particular region of the country. and organization. A director would be involved in decisions such as the overall structure of the sales force. . he might be promoted to head up the Southeastern Safeway customer team as an account executive. its chapters provide comprehensive coverage in a manner that is both interesting and engaging. Because more than one person is usually involved. and performance emphasis. At the conclusion of each chapter. exercises for developing each of the six key competencies are presented. this exercise lends itself well to a team or group discussion and role playing of conversations between individuals. Polk. A director leads the sales organization of multiple sectors and influences brand merchandising strategy and customer strategy. each chapter has been reviewed and enhanced by the experiences and suggestions of highly successful people in sales and marketing. So. Comprehensive cases are presented at the end of the book. including. A Summary at the end of each chapter revisits each learning objective. among others.

At the same time. sales management is concerned with the planning. You should now be able to do the following: 1. Describe the major changes taking place in selling and the forces causing these changes. To be an effective sales manager in a dynamic environment requires six competencies: strategic action. the selling process is becoming more focused on relationship selling. KEY TERMS Advertising Career paths Globalization Personal selling Public relations Relationship selling model Sales force automation (SFA) Sales management Sales management competencies Sales manager Sales promotion Sales representative Sales teams Transactional selling model . You can develop these competencies through study. For pedagogical purposes and by way of organizing the variety of activities involved in sales management. Sales management is defined as the planning. Where personal selling focuses on direct contacts with prospects. product life cycles are getting shorter. structuring the sales force for efficiency and effectiveness. and experience. By doing so. leading. this organization of sales management activities provides a good overview of the decisions in which sales managers at all levels in the organization are involved. and a technology competency. people are spending more of their time on internal selling and marshaling resources to develop customer solutions. 3. training. selling teams are often necessary to fully address customer needs. by reviewing the material in the chapters and addressing the challenges presented within and at the end of each chapter. you will have matured along with Doug and will have gone through the full cycle of issues common to the sales manager position. self-management. team building. 4. Describe the sales management process. Define sales management. 2. and sales force success is increasingly measured in terms of productivity and profits as opposed to topline revenues. Although these steps are not usually performed in sequence. leading. and competitive boundaries are blurring. The competitive marketplace is becoming more globalized. defining the role of the sales force in executing a firm’s business plan. and leading the sales force to achieve success. Discuss the competencies required to be a successful sales manager. a global perspective. In short. building the sales competencies necessary to implement the firm’s business strategy. organizing. and controlling of personal contact programs designed to achieve the sales and profit objectives of the firm. and their power is increasing so that they can not only demand but also obtain higher service and offerings from suppliers. You can continue practicing your managerial competencies by completing the exercises at the end of this and subsequent chapters. SUMMARY This chapter has introduced the topics of personal selling and sales management.001-032_Dal9e_c1 9/19/05 2:47 PM Page 25 KEY TERMS 25 By the end of the book. and controlling of personal contact programs to satisfy customers and achieve the objectives of the firm. you will be much further along the path to success in sales management. their service and performance expectations are increasing. you can prepare yourself for a variety of sales and sales management positions in various industries and countries. organizing. coaching. the sales management process is grouped as follows: seeing the big picture and developing strategic sales plans. As a result of these forces. customers are buying from fewer suppliers.

Self-management.001-032_Dal9e_c1 9/19/05 2:47 PM Page 26 26 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT DEVELOPING YOUR COMPETENCIES 1. Until recently. visit the company’s home page at www.) The reps in this case sold other industrial products along with the Precision line to the same customers. 6. partly because a single salesperson can never know everything about the product. (Manufacturer’s reps are not employed by the company. Which one would you prefer if you were the top sales executive of your company? 4. A good way to get started is to visit the American Marketing Association home page at www. an audio and visual equipment manufacturer.goldminesw. 5.com. 3. What did JVC do right in this SFA effort. Carter Diamond Tool has been a leader in manufacturing and has been designing high-quality synthetic and natural diamond cutting tools and dressers since 1920. If you have difficulty finding a cooperative sales manager. but the amount of pressure varies by industry.JVC. A good way to learn about sales management is to spend a day with an actual sales manager.marketingpower. providing them with instant information and saving them considerable time in having to call headquarters and customers the next day. Dissatisfied with the results. contact the local chapter of the Sales and Marketing Executives Club or the American Marketing Association. When JVC Company of America. Which sales force situation do sales executives prefer? • Average salespeople and an excellent manager or • Excellent salespeople and an average manager Consultants have asked hundreds of sales vice presidents. companies have found it difficult to transition to a sales team-selling effort from a more traditional model. Contact a sales manager and arrange to observe his or her activities during a typical day. and regional sales managers this question.com. visit its home page at www. and new accounts were acquired. Nonetheless. decided to explore sales force automation (SFA) with its 200-plus reps. they employed 10 salespeople to call on accounts. national sales managers. they sell for a number of companies. For exam- . Why did this person want to be a manager? What did they think it would be like? What was it like during the first 6 months? How did they come to their present perspective? If possible. Strategic Action Competency. GoldMine Software Corporation is a leading developer of software solutions for sales and marketing teams. Immediately. Technology Competency. Team-Building Competency. sales began to increase. it asked them two questions: “What would you like to have on your desk at home?” and “What questions do you get asked?” JVC reps wanted to be able to provide answers to their customers’ queries about purchase orders and inventory.com. or ask your instructor for help. What possible reasons might explain this? What are the advantages and disadvantages of manufacturer’s reps compared to an in-house sales force? For more on Carter Diamond Tool. Global Awareness. What are some of the problems that GoldMine is likely to encounter with a team sales operation? For more information on GoldMine Software Corporation. JVC implemented a software program that lets reps download that information from a mainframe every day. Ask him or her what it was like becoming a sales manager.com. and what other things could they have done to ensure a successful SFA implementation? For more on JVC Company. Coaching Competency. keep a log of how the sales manager’s time is spent.carterdiamond. 2. All multinational companies face pressures from customers for globalization and global integration. Firms like GoldMine that sell complex analytical software are relying more on sales teams to work with customers. visit the company’s home page at www. mostly working from their homes. Carter Diamond discharged all 10 in favor of 8 independent manufacturer’s representatives. old business was retrieved.

As luck would have it. D & M had been very good to me. and everyone would be happy. Maybe they knew something I didn’t. why couldn’t I? Plus. but with more power. After all. Copyright © by Thomas E. joined with Tom Mader to found the D & M Insurance Company. and broadened its product offerings. and management of local sales efforts. I wasn’t excited about leaving Atlanta to go to Des Moines. I didn’t want to leave. such as Hewlett-Packard and IBM. the previous manager left because “a change was needed to take the branch office into a new direction. I was finally going to get in the management game and I was ready for the move. They are not responsible for hiring. It was too late though. many of my college buddies were making it in management. That might have explained the minimal competition from other eager sales reps who were ready to spread their management wings. The most recent acquisition was the 1998 purchase of substantially all of the Commercial Lines Division of Great American Insurance Company. DeCarlo and William L. This case was prepared by Thomas E.” But I heard through the grapevine that the manager was fired because sales were off the previous years. the more I wanted it. As far I as I could tell. but the timing was perfect. averaging $150. or evaluating local Citibank employees. Howard’s vision of an insurance company was closely tied to the emerging popularity of the automobile industry and auto dealerships. Citibank’s long-running “parent account” global management program gives only coordinating responsibility to the parent account managers.. since D & M had an unwritten policy to try and hire from within and I was probably the top producer applying for the job. I really liked the competition and the excitement of sales. I’ve been one of the top four reps at D & M Insurance. the very next week a branch sales manager opening was posted in the company newsletter for the Midwest region. Cron. In subsequent years. many computer suppliers. but the global account managers are given very different responsibilities. a good sales manager would only work a little harder at the same things I’m doing now. adding subsidiaries through strategic acquisitions that enhanced its geographic reach. strengthened its selling and marketing capabilities. That is.000 per year for the past 4 years. DeCarlo of Iowa State University and William L. I did some checking into the position and according to the company statement. That is. In contrast. compensation. of Brooklyn. have created some of the most extensive and successful global account management programs. The more I thought about it. I’ve always taken pride in getting great results while doing things my way and not necessarily by the book. the company grew into an insurance group. OPPORTUNITY KNOCKS I was prepared to leave D & M within 6 months if I received a management offer from another insurance brokerage firm. If they could do it. Iowa. who just returned from World War I.001-032_Dal9e_c1 9/19/05 2:47 PM Page 27 D & M INSURANCE 27 ple. show them how it should be done and bring them up to speed. HISTORY OF D & M INSURANCE COMPANY In 1919. but lately I’d been thinking about moving to the next level. and Citibank? The three companies have mostly the same global customers. control and autonomy. D & M specialized in servicing the insurance needs of all sizes of commercial enterprises by offering I was having another good year in sales. Why is there this difference between Hewlett-Packard. IBM. the global account managers have significant line authority relative to national accounts managers. and it looked like I would do it again this year. they provide information to the local country Citibank employees and gather information from these same people. I liked the thought of Doug Bloom—Manager emblazoned on my door. At HewlettPackard and IBM. . FEATURED CASE D & M INSURANCE I had a good shot at landing the job. Just work with the worst reps awhile. mentally I already had my bags packed. Cron of Texas Christian University. they get involved in the evaluation. entrepreneur Howard Driver Sr. Lady luck was shining on me again. managing.

Employee Dishonesty Covers loss of money or property due to employee dishonesty or fraud. and workman’s compensation. competitor analysis. customized insurance and risk management programs. Computer Fraud Protects against “electronic” theft of property through a computer. feedback. product positioning. I doubt anyone in the company has read them cover-to-cover. more sophisticated accounts back when I first started. auto. Spread throughout the regions are 84 sales offices headed by a branch sales manager responsible for supervising office operations and from 8 to 12 salespeople. pricing.. Newly Acquired Property Covers newly acquired buildings. Contract Penalties Pays penalties when contract promises are not met due to covered cause. The training schedule was chaotic. Web Site Income Protects against loss of income due to web provider disruption. credit card receipts. Electronic Vandalism Protects against hackers sabotaging the company’s computer system. inventory. our major competitor in the full service market. Replacement Cost Covers property without deduction for depreciation. to say the least. The company also sold through independent brokers in the less populated states of Montana. I think they relished the idea that more information was better. Wyoming. coaching. D & M has products in a variety of areas. general liability. Good Faith Advertising Covers advertising needed to restore reputation after a covered attack. they would look impressive on my office shelf. the company flew me and six other manager wannabes to D & M’s headquarters in New York City for 5 days of management orientation. Equipment Breakdown Repairs or replaces damaged equipment (e. Dependent Properties Insures against loss of income when a major supplier suffers a covered loss. and Colorado.g. office furniture. the company was organized into four regional areas with a regional vice president heading each region. or bank drafts. performance evaluation techniques. including property. etc. Utah.) if damaged by fire or other covered loss. personnel problems. stolen. Brands and Labels Pays the cost of removing the brands and labels from damaged stock so that it can be salvaged.001-032_Dal9e_c1 9/19/05 2:47 PM Page 28 28 EXHIBIT 1 Sampling of Business Products CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT Accounts Receivable Protects against inability to collect outstanding balances as a result of lost or damaged account records. how in the world am I going to get all 25 salespeople interested in selling this new program? I remember that I felt intimidated by the larger. Other than the consultants who wrote these books. and hiring and firing tips. Exhibit 1 describes a sample of the programs D & M offers to businesses. Headquartered in New York City. Business Income Reimburses earnings when a shutdown is caused by a covered cause. Two broker sales managers were responsible for supervising and managing these independent brokers. Sales Rep Protection Protects business items. had already implemented their version of First-Plus and now D & M was repositioning itself as well. Basically. They gave us manuals on strategic analysis. Money and Securities Covers lost. I though to myself. computer. samples. I could have read the materials nonstop all week and still only be half finished. promotion. external environment analysis. SALES MANAGER TRAINING After signing my new contract on February 1. It didn’t matter. AllSafe. phones.) Forgery Protects against forged or altered checks. Business Property Pays for property (e. In those days the smaller accounts . even when under construction. The VP of Marketing expected us to redirect our staff’s selling efforts on this new product line as soon as we started our jobs. and laptop computers when traveling.. The manuals alone reached close to 3 feet high when I stacked them up in my hotel room. Denial of Service Attack Protects against computer attacks that prevent normal business operation.g. it was a renewed effort by D & M to increase revenues by encouraging sales reps to focus on larger accounts. The majority of the new manager training amounted to D & M’s rollout and promotion of the new First-Plus account program. etc. or destroyed money and securities. Idaho.

I knew I had to do something to stop the flood of questions. I got the sense she had heard this all before from previous managers. On the last day George Treadgold. “This isn’t my idea. During lunch I tried to impress her with my understanding of sales management. stories from my background. “Any questions?” I asked. Liz was planning to introduce me. I was thinking. what’s not to like? This was going to be the perfect introduction—a new manager and a new direction. “Doug. I could feel all eyes in the room were sizing me up. Why would I want to follow that model?” The room was silent. I had a corner office with a huge picture window overlooking the city. D & M’s CEO. or what? MY FIRST SALES MEETING After lunch. I thought. not what I had planned. As he was shaking my hand he smiled and offered his life-in-the-trenches line.” He also mentioned using the company policy manual to avoid any personnel problems. It was 10 degrees below zero. My first stop was to the nearest mall to buy the warmest coat I could find. We exchanged chitchat for a few minutes and then she invited me to lunch to get acquainted. “I can’t see why corporate would want us to completely abandon the smaller accounts. I’ll give you whatever support you need. You just get the reps to come up with the numbers and everything else should take care itself. this is it. As I was finishing the last bite of my chocolate torte. but the company was moving in a new direction. walked in. D & M’s branch office was on the 27th floor of a new high-rise office tower that overlooked the Des Moines River. I built in some humor. would be compensated. They throw off a ton more commissions to me than my larger accounts. She smiled and nodded. More questions followed. As I was unpacking and organizing my office. “Doug. I like everything that I’m hearing. I had some good friends there. I launched into the new strategy and provided color graphs. At first. she summed everything up by stating.” I pointed out that D & M doesn’t want us to neglect the smaller accounts. Maybe 5 percent is human relations and counseling and another 5 percent is other administration duties such as recruiting. and percentages on how the new program works and how sales reps. charts. first the CEO. Overall. if they followed just the minimum of my performance model. As I walked up to the podium. Plus. I thought to myself what an odd combination of send-off messages. Some people were actually taking notes. I wondered if everyone could see how nervous I felt. and find a new apartment in Des Moines. close bank accounts. I spent the next few days finalizing the details of my move to Des Moines. The VP of Human Resources. gave me his card. Tiffany Williams. I make more than 10 times the income level you just described and I have a lot of smaller to medium-sized accounts that have taken me years to cultivate. I had met him during my interview process 5 years ago. break my lease on my apartment. then I would take over and not look back. My hoop dream was becoming reality and I couldn’t wait to get started. raised her hand and said. shut off utilities. I knew this was going to be a big change for some people. Big mistake.” I thought. I was starting to get the feeling that management just might be my calling. my district director. moving sounded like a good idea. the top performer for the past 8 years. you understand why people stay where they are. some were staring blankly.001-032_Dal9e_c1 9/19/05 2:47 PM Page 29 D & M INSURANCE 29 she wasn’t getting as excited as I was. and a model on how to operationalize the new strategy. he said the same thing then. I thought. you are accountable for the production of this office. but after all the small hassles. The next biggest part of the job is fire fighting and solving salespeople’s problems. Someone in the back snickered. is that the company slogan. showed up to make a few remarks and shake our hands to wish us luck. then to the office to scope it out. I spent the rest of the afternoon organizing a presentation to the sales staff about the new FirstPlus account program. I cleared my throat. The big time. “bring in the numbers every month and everything else takes care of itself. I was really going to miss Atlanta. notify everyone of my new address. slapped me on the back.” Tiffany responded. It was a hectic time. good time to get them involved. though. the directive came from corporate. Liz Shute. When I arrived in Des Moines near the end of February. I felt like I had moved to the North Pole. MOVING TO DES MOINES When I returned to Atlanta. Liz gave me a great introduction. I made sure that she understood that I was going to be an action-oriented manager and that the majority of my job is sales and sales leadership. I had to bring the Atlanta office up to speed with my accounts. I didn’t understand why . and told me to call anytime if I had any problems. just remember. some of which only Liz could answer. now the district manager. Ray Cody. He didn’t remember me. I recommended that people hold their remaining were my bread and butter.

I lost respect for managers who would leave at 5:00 P. he wasn’t going to change a thing.M. I could tell she wasn’t happy about the memo.” Based on the sarcasm in her tone. I thought.” “Good. If the worst performer was telling me this. everyone would benefit by implementing aspects of the First-Plus program into their sales strategy. while others were still working.M. and I spent most of each meeting figuring out each rep’s hot buttons. I couldn’t believe what I was hearing. so it wasn’t merely an act. but all-in-all. Around 8:00 A. so I had to take action. I felt like I was speeding along a curvy highway at the top of a mountain at night with no signs such as slow. I felt like I was dealing with 25 customers.” As I hung up. But before I could talk about my ideas. She said. Each one had different motivations and talents. not too bad. When the final sales rep left on Friday afternoon. I knew the reps would not like the First-Plus program to be forced down their throats. Bill starts telling me how the FirstPlus program won’t work. Oneby-one the hands went down. If I drove off a cliff. others wanted specifics about my expectations. The next morning Tiffany Williams called me from her car phone. I was pretty sure I could get the lower performers to refocus their efforts on my model. I fired off a memo to all sales personnel requiring them to complete a weekly sales planning report. including their First-Plus activities for the week. Based on the numbers. I gave him my pitch for the future and how he could become a player by changing strategy with his larger accounts. but the higher performers might take more persuasion. No two were alike. and stop. most of the remaining meetings went smoother. MEETING THE REPS The rest of the week I spent preparing for the meetings. “Doug. the workload was much more than I expected. He said he would give it a shot and left. The results for my first month were not good—revenues slipped 15 percent. Based on what I’ve seen. narrow bridge.” I said. Monday through Friday and worked most of the day on Saturday. Plus. I was sure they would read between the lines and start focusing on the First-Plus program. so she was exempting herself. I routinely stayed after 5:00 P. Much to my surprise. He said he was on the verge of a breakthrough and that changing course now would destroy all of his hard work. Tiffany. Some meetings went better than others. some just wanted to know how I pulled off the promotion. I scheduled the lower performers for my first meetings on Thursday morning. I said. Bill Johnson. I pored over each rep’s account history and revenue numbers for the past year to find ways to sell them on the new program. approve salesperson expense reports. but I didn’t want a repeat performance next month. I could be in for a long 2 days. I made a note to myself that I was going to have to spend more time with him to show him how the program would work. my lowest performer. As he was walking out. I was worn out. I always felt it was the manager’s duty to set the example and. then everyone else would eventually get on board. I had plans for this guy and I couldn’t wait to see him begin implementing this new strategy. as a sales rep. A few were excited about the change. the entire branch office would follow me right over too. why did I say that? I shouldn’t have demanded she fill it out. “Look. however. I knew that if I could find ways to get most to buy into the plan. and I was putting in a lot of overtime. but everyone was behind on their First-Plus targets last month and that people need to take some steps to work toward those goals. It was time I showed them who was running the office. I had to deal with system crashes. She responded by informing me that she single-handedly produced 20 percent of the office’s revenue last year. but too late. I could have worked 24 hours a day and still not be caught up.” she said. the sales force was not implementing the new program. Thursday morning I was thinking how excited and nervous I was to be having my first official one-on-one meeting as a sales manager. looking forward to seeing your plan. I stared at the phone thinking. have it on my desk first thing in the morning. Although I didn’t need additional work. and prepare a 3-year strategic plan due to the home office at the end of the next month. I explained that some reps (including Tiffany) reached their overall quota. was first. curve. I felt like my wheels were slipping off the road. After he finished. I figured they would help me warm up and gain confidence for the bigger hitters to follow. “I got your memo yesterday. I just had to show them how.M. I can’t control when my clients want to meet with me and I’m just a little bit too busy to be filling out reports about how I’m going to spend my time. One thing struck me though: I was not at all prepared for the individuality of my reps. though. “I don’t think so. .001-032_Dal9e_c1 9/19/05 2:47 PM Page 30 30 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT questions for the individual meetings planned for Thursday and Friday so we could finish on time. In-between the 25 reps constantly vying for my time. Doug. review budgets. TRYING TO KEEP UP The first few weeks flew by.

He accepted immediately. It felt like I was on the outside looking in while this lunatic occupied my body. but I didn’t like the tone of her voice. BILL JOHNSON RESIGNS The next Monday I got a call from Liz to let me know that she’d had complaints from corporate. “Let me know when you want to take over my accounts too. But I’ve been covering your ass. Some were spending too much time with smaller accounts. But there were malfunctioning computers. “Look. and tried to lure him away with the promise of his own corner office and an excellent compensation package. If you need anything from my end. I’ll close those accounts myself. But. He clenched his jaw and said. what are you trying to do?” I told him I was just trying to help. and I knew I could work with him. The only place where I could get some peace was the men’s room. His voice rose. turned in their weekly reports. more than anybody else in the branch. but that I was also trying to be meticulous before I sent them over to corporate.” I wished the entire Human Resources Department was working down the hall. I immediately called the top rep at AllSafe. “you’re under quota. this is our new direction. I thought. just call. The rest of the quarter was a constant struggle to get something completed. stands for professionalism.” I said. It wasn’t me. Bloom. I think he liked the idea that if he continued to perform as he did at Allsafe. What a relief. I could count on about 15 totally different conversations within any 2-hour time span. “Maybe I’m not the best rep in the office. She shot back. he would be the highest paid rep in our office. Liz called me. Later that afternoon Bill Johnson appeared in my office. and basic jealousies I had to constantly deal with. I started hollering.” “Will do. our biggest competitor. CLOSING THE TOP 10 FIRST-PLUS ACCOUNTS My first plan of action was to identify the top 10 unclosed First-Plus accounts with the most revenue potential.” I told him I wasn’t suggesting that. I was just showing him how to implement the First-Plus account management principles. The very next day. I could feel myself tightening up. obviously upset. so why not handle HELPING REPS RESCHEDULE THEIR TIME The following Monday everyone. I also said that my reps don’t like having the First-Plus program pushed on them. One of the fundamental lessons in management training was that the manager. “You’re job is to make quota and have the reports in on time. I lost it. He said. What are your plans for turning it around next quarter?” A fair question. “Bloom. Needless to say. It was just a matter of time before I had to let him go. As a sales rep.” As soon as I hung up the receiver. If I have to. I figured a salesperson has to always be as cool as a cucumber while dealing with problem clients. Not only was I busy working with the reps so we could make our quarterly quota. rumors were flying around the office that I hired my buddy and threw lots of guaranteed cash at him. It felt like this was my first real management breakthrough. I couldn’t believe the inefficiencies in their schedules. At time I felt like a babysitter who was also running his own $30 million business.” The rest was a blur. The day after my first quarterly numbers came in. It’s your job to sell it to the reps and get the branch back on track with FirstPlus account volume. “You’re lucky I’m even helping at all. though she didn’t say anything. I’m close to getting things turned around. most of the reps were not happy about it—Williams in particular.” He threw the reorganized schedule on my desk and stormed out of the room.001-032_Dal9e_c1 9/19/05 2:47 PM Page 31 D & M INSURANCE 31 of resignation. I worked through lunch making comments and reprioritizing the reps’ week. I had completely reorganized his schedule. Not only was I falling even farther behind on paperwork. my secretary brought in Johnson’s letter . I had met him at a conference a few years ago. I continued: “Corporate wants you fired. squabbles over accounts and commissions. but I needed to update the reps on some new policies and come up with a new sales idea for our Friday afternoon sales meeting. I thought that a sales manager had the primary responsibility for taking care of the customer.” she said. but it’s nothing compared to management. I couldn’t afford to lose those accounts. “Doug. but I’m not incompetent. I wasn’t getting my expense forms in on time. Finding and maintaining composure under every situation are all you’ve got. except Tiffany. I told her I’ve been swamped. Others had large chunks of time devoted to “administrative. it was too late and I couldn’t have a “do over.” He looked completely surprised. but I wasn’t prepared for the sheer volume of fires to be put out every day. Tuesday. I was the big account guru.” No wonder we didn’t make quota last month. I told her I’d looked over the numbers and a few of the reps are close to landing some big accounts. I sat in my chair in disbelief for a few seconds. Someone always needed a “minute” to resolve a crisis—which usually meant sorting out head-on collisions reps had with clients. She said. I dashed after him and motioned him back into my office.

what’s going on here?” I said. but at this point I didn’t care whose toes I stepped on.001-032_Dal9e_c1 9/19/05 2:47 PM Page 32 32 CHAPTER 1 INTRODUCTION TO SELLING AND SALES MANAGEMENT those accounts personally? Plus. it wasn’t because my office couldn’t sell the large accounts. Williams was probably going to leave soon. “Everybody in the office is pissed about the lost commissions on the account. “Doug. but I constantly felt like I was treading water. I was working 80-hour weeks. nobody is getting any commissions on those accounts because no one seems able to close them. If I was going to get fired.” This is getting ridiculous. Plus. Corporate wants me to take responsibility. so I am. Not because I made quota for the first time. this isn’t a threat. as a rep I would have accepted it and moved on. but I’d rather quit than get fired and I saw nothing but a downward trend. The following Monday morning I circulated a memo explaining the new policy for the 10 accounts. “For 2 months now I have been trying to get people to close more First-Plus accounts. but it’s not happening. Later that same morning. but because I had a chance to rethink this whole management thing. just as I had started working on some salesperson expense reports that were already a month overdue. They would just have to understand. put the fun back into my job. I had to get a handle on my time and most of all. the customer would love it if the sales manager was their primary contact person. These ungrateful reps were resenting the fact that they were going to get a big account handed to them on a silver platter after someone else closed it. “Doug. I’ve got to do something about Williams and the other reps who might leave. everyone will get them back.” I said. DOUG BLOOM PLANS FOR THE FUTURE I was glad when the month ended. and it would take time to replace her volume.” Bill responded. I knew some reps weren’t going to be happy. Once they’re on board. Williams and another rep named Bill Barone walked into my office. you’ll find yourself taking over more accounts than you can handle. I didn’t want to quit. but I can guarantee you that if you keep pulling this stuff. If I stay.” I thought. I also got word that some of my other reps had been looking around. Williams started out. didn’t they even bother to read the memo? Williams said as she was walking out the door. Was it possible? . They had the memo in their hands and were obviously upset about it since two of the biggest accounts came from them. “As of right now.

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